Writ Petition No. 18302 of 2025 · The High Court
Case Details
- 1 - NC: 2025:KHC:22127 WP No. 18302 of 2025 HC-KAR IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 25TH DAY OF JUNE, 2025 BEFORE THE HON'BLE MR JUSTICE S SUNIL DUTT YADAV WRIT PETITION NO. 18302 OF 2025 (GM-RES) BETWEEN: 1. SUDHIR BABU S S/O SRINIVAS GUPTA S AGED ABOUT 49 YEARS 2. KALPANA SUDHIR P W/O SUDHIR BABU S AGED ABOUT 44 YEARS
Legal Reasoning
BOTH ARE RESIDING AT SRI NIKETHANA, VASAVI COLONY BENGALURU ROAD, CHALLAKERE CHITRADURGA-577 522. (BY SRI. SOWKHYA PATIL., ADVOCATE) AND: 1. M/S ICICI BANK LIMITED CHALLAKERE BRANCH CHALLAKERE TALUK, CHITRADURGA DISTRICT. PINCODE-577 522 REP.BY ITS AUTHORIZED OFFICER, CHALLAKERE BRANCH. (BY SRI. FRANCIS XAVIOR., ADVOCATE) Digitally signed by VIDYA G R Location: HIGH COURT OF KARNATAKA …PETITIONERS …RESPONDENT - 2 - NC: 2025:KHC:22127 WP No. 18302 of 2025 HC-KAR THIS WP IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PRAYING TO QUASHING THE SALE NOTICE DATED 27/05/2025 ISSUED BY RESPONDENT BANK UNDER SECURITIZATION AND RECONSTRUCTION OF FINANCIAL ASSETS AND ENFORCEMENT OF SECURITY INTERESTS ACT, 2002 (SARFESI ACT, 2002) FOR SALE OF SCHEDULE PROPERTY PRODUCED AT ANNEXURE-A AND THE AUCTION PROCEEDINGS CONDUCTED ON THE BASIS OF IMPUGNED NOTICE. THIS PETITION, COMING ON FOR PRELIMINARY HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE S SUNIL DUTT YADAV ORAL ORDER Petitioners have sought for setting aside of the sale notice dated 27.05.2025. 2. It is submitted that there are procedural violations insofar as proceedings under Section 13 of the SARFAESI Act are concerned. Various other contentions have been raised and accordingly relief is sought for. - 3 - NC: 2025:KHC:22127 WP No. 18302 of 2025 HC-KAR 3. Learned counsel for the respondent - Bank submits that the substantive remedy as against the sale notice at Annexure-A is before the Debts Recovery Tribunal in terms of Section 17 of the SARFAESI Act. 4. In light of the contentions raised, it is relevant to take note of the observations of the Apex Court in the case of Union Bank of India v. Satyawati Tondon and Others - (2010) 8 SCC 110 that the appropriate remedy would be to relegate the petitioners to seek for substantive remedy before the Debts Recovery Tribunal. The relevant observations of the Apex Court are as follows: "43. Unfortunately, the High Court overlooked the settled law that the High Court will ordinarily not entertain a petition under Article 226 of the Constitution if an effective remedy is available to the aggrieved person and that this rule applies with greater rigour in matters involving recovery of taxes, cess, fees, other types of public money and the dues of banks and other financial institutions. In our view, while dealing with the petitions - 4 - NC: 2025:KHC:22127 WP No. 18302 of 2025 HC-KAR involving challenge to the action taken for recovery of the public dues, etc. the High Court must keep in mind that the legislations enacted by Parliament and State Legislatures for recovery of such dues are a code unto themselves inasmuch as they not only contain comprehensive procedure for recovery of the dues but also envisage constitution of quasi- judicial bodies for redressal of the grievance of any aggrieved person. Therefore, in all such cases, the High Court must insist that before availing remedy under Article 226 of the Constitution, a person must exhaust the remedies available under the relevant statute. 44. While expressing the aforesaid view, we are conscious that the powers conferred upon the High Court under Article 226 of the Constitution to issue to any person or authority, including in appropriate cases, any Government, directions, orders or writs including the five prerogative writs for the enforcement of any of the rights conferred by Part III or for any other purpose are very wide and there is no express limitation on exercise of that power but, at the same time, we cannot be oblivious of the rules of self-imposed restraint evolved by this Court, which every High Court is bound to keep in view while exercising power under Article 226 of the Constitution. - 5 - NC: 2025:KHC:22127 WP No. 18302 of 2025 HC-KAR 45. It is true that the rule of exhaustion of alternative remedy is a rule of discretion and not one of compulsion, but it is difficult to fathom any reason why the High Court should entertain a petition filed under Article 226 of the Constitution and pass interim order ignoring the fact that the petitioner can avail effective alternative remedy by filing application, appeal, revision, etc. and the particular legislation contains a detailed mechanism for redressal of his grievance. 55. It is a matter of serious concern that despite repeated pronouncement of this Court, the High Courts continue to ignore the availability of statutory remedies under the DRT Act and the Sarfaesi Act and exercise jurisdiction under Article 226 for passing orders which have serious adverse impact on the right of banks and other financial institutions to recover their dues. We hope and trust that in future the High Courts will exercise their discretion in such matters with greater caution, care and circumspection." 5. In light of the observations made by the Apex Court, it can be noticed that several factual contentions - 6 - NC: 2025:KHC:22127 WP No. 18302 of 2025 HC-KAR raised by the petitioners are the matters that cannot be adjudicated in the present proceedings. 6. Accordingly, the petition is disposed off relegating the petitioners to avail of the substantive remedy as regards the impugned proceedings. All contentions of both the sides are kept open. 7. The petitioners submit that they will make efforts to clear the dues. It is submitted that the auction is scheduled on 30.06.2025. Though the respondent - Bank is permitted to go ahead with the auction, there ought to be no confirmation for a period of 2 weeks from today. 8. The interim protection granted under this order is only to enable the petitioners to avail of the substantive remedy and must not be considered to be an order passed on the basis of adjudication on merits. Upon the lapse of the time stipulated, the protection granted would cease to operate and the authorities before whom petitioners may - 7 - NC: 2025:KHC:22127 WP No. 18302 of 2025 HC-KAR approach are to look at the matter afresh uninfluenced by the observations made herein. 9. Needless to state that while considering the aspect of limitation, in the event the proceedings are instituted before the DRT, time spent before this Court may be taken note of appropriately. Sd/- (S SUNIL DUTT YADAV) JUDGE VP